Sunday, May 02, 2004

False alarm

We are sometimes told that high rates of immigration are necessary because we aren't having enough children and won't be able to support the elderly.

A University of Melbourne economist, Professor Ian McDonald, doesn't believe this is true. According to his research, living standards in Australia are likely to double over the next 50 years, even when the costs of supporting an ageing population are factored in.

Of course, this doesn't mean that the low birth rate is OK: it's a sign of a breakdown of family life in the West. But there's no reason to believe that we need large scale immigraton to support the elderly in years ahead. Economic growth will allow us to do this, and still enjoy higher rates of (material) living standards.